What does Family Business have to do with Vegetables?
Beatrice E. Wolper
Emens & Wolper Law Firm
Recently, there was a terrific article in Private Wealth Magazine titled, “Learning to Fly.” The author, Amelia Renkert-Thomas had interesting points about bringing the next generation into the family business. How to successfully transition to the next generation is one of the biggest hurdles founders face. Founders often struggle with the decisions of when to bring family members into the business . . . how to bring family members into the business . . . and how to train family members about the business.
I love Renkert-Thomas’ statement concerning when to ask if the next generation wants to join the family business: “. . . don’t rush the children. Sixteen-year olds hardly know what kind of vegetable they like, so don’t expect them to know whether they want to run their family business.”
Once the next generation is invited to be an owner, the best way to learn about management and leadership is to work in the business while the founder is still in the business. Learning by example, helping with decision making, practicing running the business are all ways the next generation can learn the business. Being able to make mistakes with help and advice available certainly lessens the problem of the mistake having serious financial implications.
Family Business Advisory boards are encouraged for many reasons. Outside advise, from trusted people, can be invaluable for the current officers, and for those family members in the learning stage. Being able to bounce ideas off people knowledgeable about the business, competition, finances and dynamics enables the next generation family members to ask questions from people not “Mom” or “Dad.” If someone else gives feed-back which is meant to be constructive, the next generation may hear it as such rather that criticism. “Try to be more organized in order to have other people respect you” if from a third person may be heard as a good idea, rather than hearing “You always were a slob and never cleaned your room. No one will ever respect you.” If younger family members join the management team and attends the advisory board meetings, the board may “serve as a bridge between generations . . . providing guidance and perspective.”
Asking the opinions of the next generation in order to form strategic plans and policies may pave the way to a successful transition and will help the road be less bumpy.